EURUSD Movement
For the 24 hours to 23:00 GMT, EUR rose 0.34% against the USD and closed at 1.3012, as calls for greater focus on growth and less on austerity helped boost the single currency against the greenback. Leaders in the European Union (EU) member states called for greater flexibility on deficit targets and a focus on growth over austerity, on the first day at EU summit.
Also, a draft statement hinted that EU leaders could loosen deficit rules, giving nations like France, Spain and Portugal extra time to meet targets.
In its monthly bulletin, the European Central Bank (ECB) stated that the Euro-zone economic activity should gradually recover later in 2013, supported by a strengthening of global demand and the accommodative monetary policy stance. Further, the central bank forecasted the region’s economy to contract 0.5% in 2013 before growing 1.0% in 2014 and reiterated that the risks to the economic outlook of the region remain on the downside. Moreover, Spain sold €803 million of bonds maturing in 2029, 2040 and 2041.
Separately, for the week ended 9 March 2013, initial jobless claims in the US fell to 332,000, marking its lowest level since the week ended 19 January 2013 and compared to the previous week’s revised figure of 342,000. Market was expecting the claims to rise to 350,000.
In the Asian session, at GMT0400, the pair is trading at 1.3023, with the EUR trading marginally higher from yesterday’s close.
The pair is expected to find support at 1.2945, and a fall through could take it to the next support level of 1.2867. The pair is expected to find its first resistance at 1.3067, and a rise through could take it to the next resistance level of 1.3111.
Euro-zone’s monthly consumer price index is forecast to improve in February, while the annual consumer price index is expected to record a drop in February. Also today, EU leaders are to hold the second day of an economic summit in Brussels. In the US, the consumer price index, industrial production and the Reuters/Michigan consumer sentiment index are keenly eyed by investors who hope for some more positive news and keep the momentum going for the greenback.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.
